Solomon Islands
pp. 31-33 · Read in the full issue
Affairs
Important Discussions Affect Finance, Taxation Cr Copra Price
MATTERS of unusual importance were considered at the bi-annual session of the British Solomon Islands Advisory Council which opened at Tulagi on Nov ember 27. and continued until the 30th.
The recently appointed Resident Com missioner, Mr. W. S. Marchant, 0.8. E., presided. Other members present were: Official: Mr. Ragnar Hyne (Chief Magis trate and Legal Adviser); Major G. E. D.
Sandars (Secretary to the Government); Mr. F. E. Johnson, 1.5.0. (Treasurer and Collector of Customs). Non-official: Mr.
D. Mackinnon, M.8.E., Right Rev. W. H.
Baddeley, D. 5.0.. M.C. (Bishop of Mela nesia); Mr. J. C. M. Scott and Mr. C. V.
Widdy .
The agenda was a full one, embracing several new regulations and amendments of various others already promulgated.
Most of these were of a non-contentious character, and were quickly disposed of.
Control Of Coastal Shipping
Such, however, was not the case when a re-draft of a Regulation to Control Coastal Shipping was brought down by the Legal Adviser. This measure was closely and trenchantly debated in com mittee, and recommendations were sub mitted for the deletion or amendment of many of its provisions which were un acceptable to non-official members.
With the underlying principle of pro viding legislation for the safeguard of life and property at sea all were in agree ment, but it was contended that the draft before the Council was to a large extent inapplicable to local shipping and condi tions, and impossible to administer effec tively. It was finally returned for alteration, witji a strong recommendation that so controversial and difficult a Regu lation should be kept in abeyance until after the war, when it can be reviewed in the light of possibly changed political and economic circumstances.
Arising out of the discussion on the Coastal Shipping Regulation, it was unanimously decided, on a motion intro duced by the Treasurer, that a prelimin ary Regulation be promulgated to provide for the number of persons which may be carried on recruiting vessels. The basis of calculation agreed upon was one per son for every half-ton of gross measure ment.
Higher Taxation
The financial estimates for the year 1940-41 were also dealt with exhaustively, and emphatic protests were voiced in respect of certain proposals which were denounced as oppressive, inequitable and unwarranted.
The Treasurer, in presenting the esti mates, stated that the current financial year would close with an estimated defi cit of £11,467, while the debit in the next fiscal year was forecast at £4,115.
To meet predicted deficiencies, he pro posed the following increases in the im port tariff: — Spirits, by 4/-, and beer by 6d., per gallon.
Cigarettes, by 5/- per thousand.
Postage, from lid. to 2d. per oz.
A duty on wireless goods, which have hitherto been free.
These items, estimated to bring in £lO5O per annum, were, in view of pre
sent circumstances, reluctantly agreed to by non-official members.
The latter, however, were unable to extend a similar acquiesence to the proposal to raise general preferential tariff from 12 2 per cent, to 17 2 per cent., and the foreign rates proportionately.
The mcrease of duty on goods from Empire sources would thereby amount to 40 per cent, on current rates.
Burden On Planting Industry
A ,.. , „ , Astonishment was expressed at the apparent lack of understanding of. or the utter indifference to, the parlous state of the one very depressed industry m the Protectorate manifest m such a proposal, despite frequent representations and warnings m Council, which are on record.
A mater of grave concern and dissatisfaction, which has frequently been brought to official notice is that, notwithstanding the incontrovertible fact that copra is produced at a loss on practically all estates, the industry is saddled with
an iniquitous export tax, which at pre sent amounts to 6 9 per ton, and which, as was pointed out, virtually constitutes a tax on capital.
It was further contended that to add to the burden of taxation in the manner contemplated must inevitably swell the already considerable number of derelict plantations with which the British Solo mon Islands Protectorate is bestrewn; and, in addition to these, there are many heavily capitalised estates owned by large Australian companies, which have been leased to individuals at peppercorn rentals in an effort to ensure a modicum of care and maintenance
Financial Counter Proposals
Considered counter-proposals to meet the estimated deficit were submitted in a joint statement, to which each indi vidual non-official member spoke in em phatic support. These were:— (1) That deficits be a charge on sur , plus funds. Accumulated reserves
(£86,246 on March 31, 1939) it was iter ated, were built up in years when revenue exceeded expenditure, and it was rea sonable and customary to draw upon such reserves during periods when ex penditure exceeded revenue. In com mercial organisations tne world over that was normal practice, and only by doing so in recent years were copra producers in the Solomons enabled to maintain comparative solvency. (2) That retrenchment of staff be effected. Notwithstanding clear and un mistakable indications of economic ad versity, the Protectorate administrative staff for several years past has been added to until it has reached numbers never before attained, and is now mark edly overloaded with young men for whom it appears difficult to find useful employment. In existing circumstances, which could have been, and were by the public, foreseen, the constant accretion of unessential personnel points to the ex tent the Administration is out of touch, or indifferent, to practical affairs, and the urgent need to practise economy.
Income Tax Suggested
(3) That, pending the essential and in evitable reorganisation of the public ser vice to relate expenditure more closely to revenue, an income tax be levied on all salaries and wages earned within the Protectorate. On a 5 p.c. basis this tax, it was estimated, would bring in over £4,000 per annum.
It was stressed that, with the exception of the Residential Tax of £1 per capita per annum, the planting industry alone was called upon to contribute a direct tax by being mulcted on the produce ex ported. This is inequitable, and par ticularly unjust in its incidence during periods of depression, when the planter is unable to meet costs of production from the sale of his produce.
As an income tax is nowhere popular, it must be noted as significant that two of the non-official members are the prin cipal executives in the Protectorate of their respective companies—the largest operating in the Solomons—and would therefore bear personally a relatively large proportion of a tax on income. They were concerned in initiating and support ing the proposal solely from a sense of equity and justice, and profound first hand knowledge of the state of the staple industry. It was suggested, in this con nection, that as the local Administration would appear to be lacking in a full rea lisation. or acting in wanton disregard of, the plight of planters and the economic situation generally, the High Commis sioner for the Western Pacific be asked to appoint a Commission to examine and report before the industry is ruined by the extortion of taxes it cannot bear.
Price Of Copra
A request was tabled, and agreed to without debate, that the High Commis sioner be asked to represent to the Brit ish Government, which is controlling the marketing of copra, the need to fix a price which will allow producers a small margin over cost of production. In view of the rising price of all commodities im ported, the rate regarded by non-official members as necessary in the circum stances, was stated as £l5/10/-, London.
The New Guinea Planters’ Association, it was stated, is preferring a similar re quest through the Commonwealth Gov ernment, with, however, certain differ ences in the price suggested owing to marketing costs being less in New Guinea, due to a variety of reasons, among them, considerably lower overseas freight rates, cheaper labour, and much more favour
able tariff rates both for imports and exports as compared with the Solomon Islands.
Empire’S War Effort
In a reference to the war in which the Empire is involved, non-official members presented a joint statement setting forth that as there seemed no way in which the Protectorate could actively partici pate in its prosecution, the people of the Solomons would look upon it as a graci ous and patriotic act if a substantial, voluntary gift from the accumulated re serves was donated to His Majesty’s Gov ernment as a token of gratitude for the freedom they enjoy, and the safety assured them by the sacrifice, gallantry and efficiency of His Majesty’s Naval, Military and Air Forces —services towards the maintenance of which the Protec torate makes no contribution.